Greek life worsens as crisis drags on

Nation's leader warns of "societal explosion"

Associated Press

Associated Press

Published 9:11 pm, Wednesday, February 20, 2013

FILE - In this Tuesday, Jan. 15, 2013, file photo, old sales and for rent signs are seen in a vacant storefront in central Athens. Researchers from Greece's largest labor union, the GSEE, say the country's three-year crisis has left nearly two-thirds of private sector employees without receiving their regular salaries. GSEE has called a general strike for Thursday, Feb. 20. (AP Photo/Thanassis Stavrakis, File)

FILE - In this Tuesday, Jan. 15, 2013, file photo, old sales and...

FILE - In this Wednesday, Feb. 6, 2013, file photo people reach out for fresh produce handouts from fruit and vegetable street market stall holders during a farmers' protest outside the Ministry of Agriculture in Athens. Researchers from Greece's largest labor union, the GSEE, say the country's three-year crisis has left nearly two-thirds of private sector employees without receiving their regular salaries. GSEE has called a general strike for Thursday, Feb. 20. (AP Photo/Thanassis Stavrakis, File)

In this photo made Thursday, Feb. 18, 2013, unemployed worker Maria Kanga chants slogans using a loudspeaker during a protest in central Athens. Kanga, a mother of two, was laid off when a record store chain went out of business last year but is still owed five months' pay and severance money. Researchers from Greece's largest labor union, the GSEE, say the country's three-year crisis has left nearly two-thirds of private sector employees without receiving their regular salaries. GSEE has called a general strike for Wednesday Feb. 20. (AP Photo/Petros Giannakouris)

FILE - In this Tuesday, Feb. 5, 2013 file photo, an unpaid striking dock worker sits next to an idle ferry, at the port of Piraeus, near Athens. Researchers from Greece's largest labor union, the GSEE, say the country's three-year crisis has left nearly two-thirds of private sector employees without receiving their regular salaries. GSEE has called a general strike for Wednesday Feb. 20. (AP Photo/Petros Giannakouris, File)

Protesters with placards reading "Merit" and "Firing" gather during a protest in the northern port city of Thessaloniki, Greece, Wednesday, Feb. 20, 2013. Some 17,000 protested peacefully in the city on Wednesday as unions staged a general strike to protest government spending cuts and tax hikes, which some predict will push unemployment to an alarming 30 percent. (AP Photo/Nikolas Giakoumidis)

FILE - In this Tuesday, Jan. 22, 2013 file photo, a homeless man sits near the closed entrance of a Metro station in central Syntagma square during a strike held by the unions of metro services in Athens. Researchers from Greece's largest labor union, the GSEE, say the country's three-year crisis has left nearly two-thirds of private sector employees without receiving their regular salaries. GSEE has called a general strike for Feb. 20. (AP Photo/Petros Giannakouris, File)

ATHENS, Greece — Looking out across a room full of reporters gathered to welcome French President Francois Hollande, Greece's President Karolos Papoulias gave a stark warning about the state of the country after three harsh years of government spending cuts, joblessness and tax hikes.

"We are faced with a societal explosion if any more pressure is put on society," he said Tuesday

In spite of Greece receiving much-needed bailout loans, life seems to be getting worse for ordinary people.

Not only are Greece's 1.35 million unemployed unable to make ends meet, but a growing number of those in work are struggling as more and more companies can no longer make regular salary payments. As well finding it harder to support their families, Greek workers also have to pay higher taxes the government is relying on to turn the economy around.

Greece's trade union organization, the GSEE, organized a general strike Wednesday to protest a new series of austerity measures. It warns that the labor force — which includes a large public sector — has been too badly weakened to help the battered country recover.

Analysts are worried Greece will face more years of struggle and protest as more demands are made on a shrinking workforce.

Since it was priced out of the international debt markets in 2010, Greece has relied on emergency loans from other eurozone countries and the International Monetary Fund. To continue receiving these loans, the Greek coalition government has had to agree to harsh spending cuts and tax hikes to try and lower public debt. These measures, however, have also put the brakes on Greece's economy and hit ordinary Greeks hard.

"The government is thus caught between a rock and a hard place, trying to balance the demands of its domestic and foreign audiences," said Martin Koehring, Greece Analyst at The Economist Intelligence Unit.

"We expect political risk — social unrest and the instability of the fragile three-party government coalition — to remain a major focal point in Greece this year."

The country, of nearly 11 million people, is stuck in a five-year recession. Greece now has the highest unemployment rate in the 17-strong group of European Union countries that use the euro, with 27 percent out of work — 60 percent of those aged under 24. The government-funded research institute KEPE has forecast that unemployment will hit 30 percent.

The crisis has left 450,000 households with no one working, while a one-year limit on unemployment benefits — and strict rules to qualify for them — mean just 225,000 jobless Greeks are receiving monthly state assistance.

Maria Kanga, a jobless mother of two, is worried about what she'll do when her assistance runs out this summer. She was fired from a record store chain that closed last year. She and 150 others were left unpaid for five months and then received no severance money.

Protesting outside a Eurovision Song Contest event hosted by a company co-owned by her former employer, Kanga summed up her situation: "We've cut back on everything ... My daughter is 12 years old. She has one pair of shoes. If they get wet, there are no spares."